Former City of Miami Police Officer Sentenced in Identity Theft Tax Refund Fraud Scheme

A skimming device is a piece of hardware that is attached to any credit/debit card processing machine and will record all the data that is contained on the magnetic strip on the back of your card. The skimming device is often supplemented with a camera discreetly positioned so that it can secretly record you enter your PIN number if using a debit card. A skimming device can be placed on ATM machines, gas station pumps and at the cashier at your local retailer.

Check the machine you are using for any suspicious additional hardware attached to it or for a warning sticker that has been cut or torn.

A skimmer can be small and inconspicuous, but it is nonetheless an additional piece of hardware that must be physically attached to any machine that you are using. Always be sure to check for any hardware that looks like it was manually added and does not conform to the rest of the machine.  On some machines, the skimmer can be attached in a hidden compartment such as a gas station pump. The gas station pump credit/debit card swipe is often covered and you will not be able to see a skimmer that is attached to it because it is hidden behind a panel or compartment that must be opened in order to access it. Many gas stations place a sticker over the panel opening so that it must be removed, cut or torn in order to reach the component the skimmer must be attached to. Whenever one of these stickers looks stretched, excessively worn, or severed, you should look for a different pump or gas station.

Use a credit card over a debit card whenever possible.

The reason for this is due to the differences between how a credit card and debit card work. A credit card is simply a line of credit extended to you from a financial institution. When you pay for something with a credit card, you are creating a debt with the financial institution that you will have to pay later. A debit card is different in that it is not a line of credit, but a conduit to your bank account which contains your hard earned money. This is related to two problems that   occur when your debit card is used for fraud as opposed to your credit card. First, since your debit card is attached to your bank account, a criminal can potentially drain all the money out of your bank account leaving you with no money to pay your bills. A criminal using your credit card can run up a nasty bill, but at least you will still have the money in your bank account to be able to pay bills such as rent and car payments. Second, banks treat debit cards and credit cards differently when it comes to fraudulent transactions. Credit cards are offered much more robust liability protection in that, generally, your liability for fraudulent transactions will usually be at maximum $50.00. A debit card on the other hand will have liability limited to $50.00 so long as you report the fraudulent transaction within two days. Your liability will be limited to $500.00 if reported between 2 and 60 days, and you will be liable for the entire fraudulent transaction if you fail to report it within 60 days.

Monitor your credit and debit card accounts as often as possible.

In order to reap the benefits of limited liability and to prevent a thief from using your card information over several days or weeks, you must be vigilant in monitoring your accounts to find evidence of fraudulent transactions. The sooner you detect a fraudulent transaction, the faster you will be able to report the fraud to your financial institution, limit your liability for the purchase, and shut down the card so that it can no longer be used.

“Three Tips to Avoid Skimming Device Consequences” was written by Sam Imandoust, Esq. He serves as a legal analyst for the Identity Theft Resource Center. We welcome you to post/reprint the above article, as written, giving credit to the author and linking back to the original posting.

The Medical Identity Fraud Alliance has recently published its first whitepaper titled, The Growing Threat of Medical Identity Fraud: A Call to Action, focusing much needed attention on the urgent issue of medical identity theft and fraud.

MIFA is the first public/private sector-coordinated effort with a focused agenda that unites all the stakeholders to jointly develop solutions and best practices for fighting medical identity fraud. The whitepaper defines medical identity fraud  as the fraudulent use of an individual’s protected health information (PHI) and personally identifiable information (e.g., name, Social Security number) to obtain medical goods and service or to gain financial benefit. Medical identity theft is defined as the stealing of an individual’s protected health information.

The number of medical identity theft victims in the United States has increased from 1.42 million in 2010 to 1.85 million in 2012 and healthcare fraud, which almost always requires medical identity theft to commit the fraud, costs the United States at least $80 billion a year. Medical identity theft and fraud is much more complex and difficult to mitigate than the much more publicly known financial identity theft and fraud. Because criminals can monetize medical identities 20 to 50 times better than a financial identity, the value of a medical identity can be up to 50 times greater than a Social Security number alone. The high value of medical identities motivates criminals to put more effort in illegally attaining medical identities resulting in more and more cases of medical identity theft. As more and more PHI is being converted from paper health records to electronic health records (EHR) to improve information sharing and accessibility, the PHI becomes increasingly vulnerable to data breaches.

In the paper, MIFA stresses that the individual must be the first line of defense to medical identity theft and fraud. Lessons can be learned from the credit card industry and how they handled financial identity theft and fraud. They started off by sharing fraud data and developing sophisticated analytics to identify potentially fraudulent credit card transactions, but also began verifying the flagged transactions with the consumers themselves. This process inducted the consumer into the fight against fraud and helped the credit card industry crack down on fraud. The equivalent cooperation between the healthcare industry and the consumer is to send an Explanations of Benefits (EOB) about 30 days after a medical service is provided, but people rarely actually read them and when they do, they rarely understand them. Therefore, EOBs are for the most part ignored and the communication between the consumer and the healthcare industry is broken making it difficult for insurance plans to identify a fraudulent claim quickly.

MIFA believes that in order to correctly mitigate the medical identity issues facing the healthcare industry today, there needs to be a coordinated approach between key stakeholders from the healthcare industry, security, compliance and privacy companies, government, law enforcement, nonprofit organizations, and academe. MIFA was formed to bring together stakeholders from each industry and provide leadership to:

• Develop an awareness, education, and training campaign for the public and the healthcare industry.
• Inform public policy decision makers about medical identity theft and fraud and its current and evolving impact through awareness, education, and research programs.
• Establish a comprehensive applied research agenda.
• Promote and encourage innovative best practices, processes, and technology to prevent and detect medical identity theft and fraud.

Several key stakeholders, including the ITRC, founded MIFA and have already begun this process, but more stakeholders, cooperation and information sharing are needed. Visit the Medical Identity Fraud Alliance website and see how you can help!

“Medical Identity Fraud Alliance: A Call to Action” was written by Sam Imandoust, Esq. He serves as a legal analyst for the Identity Theft Resource Center. We welcome you to post/reprint the above article, as written, giving credit to the author and click here for  linking back to the original posting.

Los Angeles – Doctor & Patient Recruiter Plead Guilty in Defrauding Medicare

WASHINGTON—A Los Angeles-area doctor and a patient recruiter pleaded guilty today for their roles in a power wheelchair fraud scheme that defrauded Medicare of over $10.1 million.

The plea was announced by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); Steven Martinez, Assistant Director in Charge of the FBI’s Los Angeles Field Office; and Joseph Fendrick, Special Agent in Charge of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse.

Dr. Emmanuel Ayodele, 65, of Los Angeles, and Alejandro Maciel, 43, of Huntington Park, California, pleaded guilty before U.S. District Judge George Wu in the Central District of California to one count of health care fraud and one count of conspiracy to commit health care fraud, respectively.

Ayodele admitted that he defrauded Medicare by participating in a power wheelchair fraud scheme with the operators of fraudulent durable medical equipment (DME) supply companies. According to court documents, DME suppliers provided Ayodele with patients recruited by street-level patient recruiters or “marketers,” who illegally solicited people with Medicare benefits for power wheelchairs and other DME that the people did not need. In court documents, Maciel admitted that he was one of these marketers.

Maciel admitted that he approached people at their homes, swap meets, grocery stores, and other locations and made various misrepresentations to the people about his true identity and Medicare. Maciel admitted that these misrepresentations allowed him to gain the trust of Medicare beneficiaries and convince them to provide him with their Medicare billing and personal information, which Maciel, Ayodele, and their co-conspirators used to defraud Medicare. Maciel also admitted that, through his misrepresentations, he convinced people to travel with him to fraudulent medical clinics and DME supply companies owned and operated by his co-conspirators. Ayodele admitted that he owned one of these fraudulent medical clinics, Beth Medical Clinic, which he operated in Los Angeles.

Ayodele admitted that, at Beth Medical, he wrote medically unnecessary prescriptions for power wheelchairs and DME. Ayodele admitted he knew that the DME supply companies used the medically unnecessary prescriptions and documents that he wrote to submit claims to Medicare for medically unnecessary power wheelchairs and DME. For example, Ayodele admitted that the operators of fraudulent DME supply company Bonfee Inc., who were indicted with Ayodele and Maciel on Medicare fraud charges, paid Ayodele to write a medically unnecessary power wheelchair prescription for one of Bonfee’s customers and then used that prescription to submit a false power wheelchair claim to Medicare that totaled over $6,000.

Maciel admitted that his profit from the scheme came in the form of illegal kickbacks paid to him for every person whose Medicare billing and personal information his co-conspirators successfully used to bill Medicare for power wheelchairs or other items of DME. According to court documents, once his co-conspirators successfully billed Medicare, Maciel delivered the power wheelchairs and other DME to the people whom he recruited. During these deliveries, Maciel observed that the people could walk and that they did not have a legitimate need for the wheelchairs and other DME.

As a result of their conduct, Ayodele and Maciel admitted that they and the owners and operators of Bonfee, Lutemi Medical Supplies, and other fraudulent DME companies submitted and caused to be submitted over $10,132,178 in false and fraudulent claims to Medicare. Ayodele and Maciel admitted that Medicare paid Bonfee and the other DME supply companies over $5,388,754 on these false and fraudulent claims.

Two of Ayodele and Maciel’s co-defendants, Charles Agbu, a former pastor who owned Bonfee, and Dr. Juan Van Putten, have pleaded guilty to Medicare fraud charges and are scheduled for sentencing on August 15, 2013, and September 26, 2013, respectively. Ayodele and Maciel’s other co-defendants, Obiageli Agbu and Candalaria Estrada, are scheduled for trial on July 9, 2013.

The owner of Lutemi, Olufunke Fadojutimi, a registered nurse, was arrested on May 14, 2013, on Medicare fraud charges. Fadojutimi is scheduled for trial on October 22, 2013. Defendants are presumed innocent unless proven guilty in court.

At sentencing, scheduled for September 30, 2013, Ayodele and Maciel each face a maximum penalty of 10 years in prison and a $250,000 fine.

The case is being prosecuted by Trial Attorneys Jonathan T. Baum, Alexander Porter, William Kanellis and Blanca Quintero of the Criminal Division’s Fraud Section. The case is being investigated by the FBI, HHS-OIG, and the California Department of Justice.

The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.

Seniors  or shall I say baby boomers, have more disposable income, good credit reports, and tend to forgo  on-line review of credit reports or using such web sites as – ouptoutpresceen to remove their names from  various data bases on line. Older consumers are not more vulnerable to identity theft than others, but  tend to be victims of the types of ID theft that are on the rise — cases involving tax returns and medical care.